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Gas Storage Vital For Southeast Europe Economic Development-EBRD

Gas Storage Vital For Southeast Europe Economic Development-EBRD
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Τρι, 16 Φεβρουαρίου 2010 - 18:41
Further investment in natural gas storage and associated infrastructure is vital to ensure the energy supply security needed to further the economic development of southeastern Europe, said Riccardo Pulitti, Managing Director For Energy at the European Bank for Reconstruction and Development Tuesday.
Further investment in natural gas storage and associated infrastructure is vital to ensure the energy supply security needed to further the economic development of southeastern Europe , said Riccardo Pulitti, Managing Director For Energy at the European Bank for Reconstruction and Development Tuesday.

"[Gas storage] is very significant to make the region attractive to foreign direct investment," Pulitti told Dow Jones Newswires in an interview. "When a company is deciding whether to invest, the issue of security of energy supply stands right at the top," but without more gas storage much of the region is currently very vulnerable to disruption to Russian supplies, as occurred a year ago, he said.

The EBRD expects to sign an agreement Thursday to loan Serbia EUR150 million to upgrade its gas pipeline network and build a new underground gas storage facility in the north of the country that, combined with an existing facility, should give it 10-12 days backup supply.

Serbia gets 94% of its gas from Russia so this investment, "can mitigate any disruption that might occur due to conflict between supply countries and transit countries," Pulitti said.

Following a dispute over gas prices and unpaid bills, Russia cut off gas supplies to Ukraine for much of January last year, resulting in a big drop in gas supplies to southeast Europe .

The EBRD has already funded similar projects in Croatia and Hungary and is mulling additional loans to Bulgaria , Moldova and Croatia .

EBRD loans for this purpose should total around EUR1 billion over a two-year period, Pulitti said.

The bank's aim is to give the region as a whole a supply cushion of between eight and 20 days, although some countries like Bosnia-Herzegovina are geologically unsuitable for such facilities and will have to rely on their neighbors, he said.

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